Legal certainty boosts business ties between Australia and the United Arab Emirates

Legal and business ties between Australia and the UAE were reinforced last week as the New South Wales Supreme Court and the Dubai International Financial Centre (DIFC) Courts signed a Memorandum of Guidance (MoG) at a ceremony in Sydney.

The milestone document, which covers the mutual enforcement of money judgments, was signed by NSW Chief Justice Tom Bathurst and DIFC Courts Chief Justice Michael Hwang, in the presence of NSW Deputy Premier and Minister for Trade and Investment, Andrew Stoner MP and the Charge d’Affaires for the UAE Embassy to Australia, Abdulbaset Al Marzooqi.

The DIFC Courts are Dubai’s established English language, commercial common law courts, and form a key part of the legal system of the United Arab Emirates – Australia’s largest Middle Eastern trading partner. The New South Wales Supreme Court has unlimited jurisdiction within Australia’s largest state in civil matters, and also hears the most serious criminal matters. Its civil and commercial jurisdiction is the busiest of any Australian court, and is internationally renowned for its experience and expertise in dispute resolution.

Dubai and New South Wales both serve as major investment gateways into their respective countries and wider regions. New South Wales is the regional headquarters of more than 600 blue chip companies, and the state generates 31% of Australia’s Gross Domestic Product. Like the DIFC, New South Wales is a key regional hub for the financial services sector, with 59 of the 64 banks operating in the state capital Sydney.

The memorandum represents the first time an Australian court has entered into an understanding to consult and cooperate with the DIFC Courts on the enforcement of each party’s money judgments in the other’s courts. Chief Justices Bathurst and Hwang agreed the memorandum would give certainty and clarity to investors, businesses and legal professionals operating in each jurisdiction by defining, for the first time ever, the method of enforcement of judgments.

The MoG is concerned only with judgments requiring a person to pay a sum of money to another person. It also sets out the procedures which a person seeking to enforce a New South Wales Supreme Court judgment in the DIFC Courts would need to follow, and vice versa. The enforcement guidance has been written with the objective of ensuring that claims are dealt with swiftly and generally without the need for oral evidence.

Since the DIFC Courts’ jurisdiction was opened to businesses worldwide in October 2011, the Courts’ money judgments can be enforced internationally through treaties such as the GCC Convention and Riyadh Convention, conventions with China, India and France and reciprocal arrangements with many common law courts overseas. Most recently, in January 2013, the DIFC Courts signed a memorandum with the Commercial Court of England and Wales, which defined similar key issues, including the mutual enforcement of money judgments.

The signing also brings to three the number of memoranda now in place between the NSW Supreme Court and international jurisdictions. Other agreements covering issues arising under foreign law have previously been signed with the Singapore Supreme Court and New York State Court of Appeals.

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